Contracting options

Agencies interested in applications outsourcing have a number of sources. Companies such as Accenture, Affiliated Computer Systems Inc. (ACS) and Keane Federal Systems Inc. have outsourcing operations. Application service providers (ASPs), sometimes referred to as managed services providers, offer another option. Those include EYT, Qwest Communications International Inc. and USinternetworking Inc., which are on the General Services Administration schedule.

Software vendors also are in the mix, with Oracle Corp. and SAP AG among the providers representing a range of contracting approaches. In some cases, vendors have reworked their commercial services for the federal market. Keane Federal, for example, operates application management facilities in Halifax, Nova Scotia, and two locations in India. But offshore outsourcing is not an option for federal customers, said Charlie Lippman, director of application outsourcing at Keane Federal. Instead, the company provides services at the government customer's location.

"Typically, we are looking to place a program management organization on site," Lippman said. That was the case for the Marine Corps Materiel Command's outsourcing project. Keane Federal established a program management organization, documented the application and set metrics for measuring quality.

An ASP, meanwhile, typically manages customer applications at its own facility. This off-site approach may be attractive to agencies concerned about business continuity. The Labor Department earlier this year awarded a hosting services contract to Qwest, which provides disaster recovery services for Labor's Employment and Training Administration. Qwest operates Internet data centers in Colorado and Virginia.

Like Keane Federal, Qwest has tuned its services for the federal sector. The company, for instance, meets the government's security requirements for processing sensitive but unclassified data, said Wes Kaplow, chief technology officer of Qwest's Government Services Division.

Oracle, meanwhile, offers a middle road between on-site service and off-site hosting. With its hybrid model, the customer hosts the software using its own hardware, while Oracle remotely maintains the application and database technology, said Greg Myers, vice president of outsourcing and partners for Oracle's public-sector unit. This service is provided solely for Oracle applications and databases.


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